1. Field of the Invention
The present invention relates generally to methods and systems for compensating electronic affiliates. More particularly, the present invention relates to methods and systems to provide affiliates with strategic incentives that match the merchant's own sales and marketing goals.
2. Description of the Related Art
To increase the volume of shoppers visiting a given World Wide Web (hereafter “Web”) site, it is helpful to establish a strong brand identity, to develop customer loyalty and to establish a pervasive site presence. One of the ways that Web merchants have found to draw traffic to their sites is to enlist the aid of other Web sites, called affiliate sites. The affiliate agrees to represent the merchant's products or services on their Web site in exchange for compensation. The merchants engage in this business relationship in order to broaden their reach on the Internet and to sell more products and/or services. Indeed, affiliate sites may be considered as a “virtual sales force”, as they constitute in inexpensive venue in which to showcase and promote the goods and/or services offered by the merchant Web site. The merchant site, however, is not responsible for the financial safety of the affiliate. Indeed, the agreement between the merchant and the affiliate may specify that the affiliate receives no compensation unless specified actions occur. In addition, an affiliate may be an affiliate for more than one Web merchant. Affiliate sites are typically complementary and approved Web sites that offer a link back to the Web merchant's site. The link may point to the Web merchant's home page or may “deep link” to a Web page featuring a specific product and/or service within the Web merchant's Web site. Such affiliates are commonly used in the eCommerce industry to market products, generate new customers and to generate sales. In return, the affiliate is compensated, typically on the basis of orders generated by customers who “click through” the link to the merchant's Web site and purchase a product and/or service therein. Currently, it is believed that the industry employs a rather simplistic compensation scheme to determine the affiliate's compensation, which scheme is believed to be assigned to the affiliate and based upon a percentage of the sales generated through the affiliate site.
However, such a compensation scheme constrains the choices available to the affiliate and fails to provide any opportunity for the affiliate to maximize their compensation, other than blindly increasing the traffic to the merchant site. More particularly, conventional compensation schemes do not allow the merchant to create or manage incentives for the affiliate to sell the optimal product to the optimal customer at the optimal time. Indeed, conventional affiliate compensation schemes do not allow the merchant or the affiliate to skew sales to products with excess inventory, to enlist the aid of affiliates in deploying marketing campaigns for specific goods or services or to create customized and differentiated compensation plans to avoid conflicts between competing affiliates.
What are needed, therefore, are methods and systems for compensating affiliates that are more flexible, provide incentives to the affiliate to sell targeted products and/or services and to generally align the affiliates' compensation and interests to the merchant's strategic sales and marketing objectives. In effect, what are needed are methods and systems for compensating affiliates that transforms the participating affiliates into de facto strategic partners with the Web merchant.